Circular procurement is an approach that recognises the role that private and public authorities can play in supporting the transition towards a circular economy. Circular procurement can be defined as the process by which private or public authorities purchase works, goods or services that seek to contribute to closed energy and material loops within

supply chains In commerce, a supply chain is a network of facilities that procure raw materials, transform them into intermediate goods and then final products to customers through a distribution system. It refers to the network of organizations, people, activ ...

, whilst minimising, and in the best case avoiding, negative environmental impacts and waste creation across their whole life-cycle. As a concept it builds on

Sustainable Procurement Sustainable procurement is a process whereby organizations meet their needs for goods, services, works and utilities in a way that achieves value for money on a life-cycle basis while addressing equity principles for sustainable development, there ...

, adding elements such as closed-loop material use. Content is copied from this source, which is © European Union, 1995-2018. Reuse is authorised, provided the source is acknowledged.

Policy context

The EU Action Plan for the Circular Economy has established an ambitious programme of action which will help to ‘close the loop’ of product lifecycles. This plan recognises

public procurement Government procurement or public procurement is the procurement of goods, services and works on behalf of a public authority, such as a government agency. Amounting to 12 percent of global GDP in 2018, government procurement accounts for a sub ...

as a key driver in the transition towards the circular economy, and it sets out several actions which the

European Commission The European Commission (EC) is the executive of the European Union (EU). It operates as a cabinet government, with 27 members of the Commission (informally known as "Commissioners") headed by a President. It includes an administrative body ...

will take to facilitate the integration of circular economy principles in GPP. These include highlighting circular aspects in new or updated sets of EU GPP Criteria. Circular public procurement also has a role to play in achieving the Sustainable Development Goals, defined by the

United Nations The United Nations (UN) is an intergovernmental organization whose stated purposes are to maintain international peace and security, develop friendly relations among nations, achieve international cooperation, and be a centre for harmonizi ...

2030 Agenda for Sustainable Development. Especially,

SDG 12 Sustainable Development Goal 12 (SDG 12 or Global Goal 1), titled "responsible consumption and production", is one of the 17 Sustainable Development Goals established by the United Nations in 2015. The official wording of SDG 12 is "Ensure su ...

- Responsible Consumption and Production – includes a specific target on promoting public procurement practices that are sustainable, in accordance with national policies and priorities. Furthermore, several countries, regions, and cities have been developing their own circular strategies in which public procurement is often emphasized as key mechanism for scaling up the transition to a circular economy.

Three Levels of Circular Procurement

There are three types or ‘levels’ of models for implementing circular procurement: * ‘System level’: concerns the contractual methods that the purchasing organisation can use to ensure circularity. For example, supplier take-back agreements or product service systems * ‘Supplier level’: how suppliers can build circularity into their own systems and processes, in order to ensure the products and services they offer meet circular procurement criteria. * ‘Product level’: focused solely on the products that suppliers to public authorities may themselves procure further down the supply chain.

Benefits

As an addition to sustainable procurement, circularity can help buyers take a more comprehensive approach - from the first stages of a procurement to the end of product life – while also achieving financial benefits. A circular economy will retain materials at their highest value, push for innovation and support local employment markets. By 2025, at a global scale, it has an estimated potential to add $1 trillion to the global economy and create 100,000 new jobs within the next five years.

Policy context

Three Levels of Circular Procurement

Benefits

References

Further reading